Amid India’s economic boom, more and more multinational companies have continued to expand their services in India. For this they need skilled staff. But it is becoming more and more difficult to hire well-qualified professionals in India.
A skilled workforce has become expensive in India
The University of Pune's Fergusson College is one of the oldest and most renowned educational institutions in India. Graduates from here have excellent job opportunities. Bhushan, a student of event management at Fergusson College, says:
"I believe in the quality of this city. I believe in the quality of this education scenario over here. Job opportunities are enhancing day by day. The different companies are coming to our college premises for job interviews. So it's really great to get loads of experience."
Those graduating from college as computer scientists can expect to earn up to 2,000 Euros per month in their first job -- some years ago this was the standard salary for middle management.
University and industry: a "virtuous circle"
Pune used to be called the "Oxford of the East". But meanwhile the metropolis of five million inhabitants close to Mumbai is not only a prime location for education, it has also become a centre for car production, engineering and the software industry.
"We have 200 years of tradition of excellence in education", says Narendra Jadhav, the Vice Chancellor of Pune University. "So that gave us a very good head-start. When a large number of companies started coming in with the opening of the economy, they in turn attracted more students because of the possible job opportunities right then and there. So it is mutually reinforcing, a virtuous circle."
North of Pune the German car maker Volkswagen is trying to exploit the growth potential of the region. Volkswagen has laid off altogether 20,000 workers in Germany over the last few years. But in India, they are currently hiring 2,500 new employees.
"We have found many well-qualified people here", says Jörg Müller, the president of Volkswagen India. "Especially in the beginning we need people with some experience, and we are quite optimistic right now."
The problem of staff fluctuation
When recruiting experienced staff, Volkswagen needs to headhunt them from its competitors. When offered higher salaries, Indians tend to be ready to change employers. This is an advantage for a company like Volkswagen which is trying to establish itself. But it also means it is not easy to keep the staff, says Jörg Müller:
"Now it is important for all companies working in India to address the problem of staff fluctuation. Some companies here have a fluctuation rate of about twenty per cent. Many regard this as normal, but I don't accept this. We have to work hard to show our present and future employees that we are the number one employer and keep the fluctuation rate down in this way."
In a country of more than a billion people, finding and keeping well-qualified staff has become a major challenge for multinational companies.